If you are talking about a reservation being canceled weeks or days before arrival then this is correct. But the person you were quoting was referring to be walked at a sold out hotel on arrival.

Hilton’s policy when a Diamond member shows up at the hotel with a confirmed reservation requires the hotel to do various things (rebook, payment, points and stay credit) and if the hotel doesn’t fulfill their responsibilities then the Diamond Desk will.
There are a couple threads on this in the Hilton forum, at least one generally related to being walked and one for Diamonds being walked.